North American Construction Group has been awarded a long-term contract extension in the oilsands that boosts its work backlog to over $1 billion.
The three-year extension to a key multiple use agreement with a major earthworks customer takes the existing expiration date of December 2020 to December 2023.
As part of this additional term, the company has secured a five-year contract through 2023 for earthworks services at the customer’s base mine.
The value of this backlog is expected to be approximately $750 million. This follows two term contract awards in June that resulted in current backlog over $300 million.
The new contract is good news for the company, which in October announced it would purchase of Aecon Group’s contract mining business for $199 million.
“This step change in contractual backlog provides us with even further confidence that our recently increased equipment fleet will be fully utilized and our impressive growth trajectory can be maintained for several more years,” CEO Martin Ferron said in a statement.
“The award from our customer is based on demonstrated and tangible results of operational excellence at their mine as we execute earthwork services.”